State Tax Collections Surge Due To Underestimated Sales Taxes

Indiana took in $134 million more in taxes last month than fiscal analysts predicted – that’s 20 percent better than projections, the best performance in nearly two years.

The surge was driven primarily by sales tax collections, which came in more than $96 million better than expected. That’s 250 percent above predicted levels. The State Budget Agency says it’s due to a complicated underestimation involving last year’s revenue numbers and the number of paydays in the previous month.

Overall, sales tax numbers for the entire fiscal year are just slightly ahead of projections, as are individual income tax collections. Corporate taxes continue to lag behind expectations.

Lawmakers will receive a new revenue forecast in April, just days before they’re expected to finalize a new two-year state budget.